Welcome to Halifax's new condo market

Luxury condominiums could be the key to Halifax's survival.

It’s a condo conundrum. Do you go downstairs to use the indoor pool or get some exercise on the full-size indoor track? Actually, maybe a brisk stroll through the shops below is considered cardio. But don’t forget there’s also cocktails on the sixth-floor terrace with the neighbours later. Or maybe you’ll just grab a bottle of Opus One 2008 from the built-in under-the-counter wine cellar and spend the night in, gazing out at the unspoiled, undeveloped view. There’s also that fabulous sushi restaurant around the corner whose tuna tartare rivals the stuff you had in Japan. You wouldn’t even have to go out to get it—the new concierge, what’s-his-name, can bring it up. As you stand in your high-end, stainless-steel-and-marble kitchen, weighing your options, the built-in coffee station suddenly finishes brewing your gourmet Guatemalan espresso. Overwhelmed by the decisions and distracted by the aroma of fresh java you give up and retire to one of two ensuite bathrooms for a bath in the oversized soaker tub. A brief repose ensconced in marble and dim lighting will undoubtedly help you figure out your plans.

Oh, condo living is a hard one and, like it or not, it’s the soon-to-be reality for a lot of Haligonians. Get ready—the condominiums are coming.

The imagined reality above is set in Pavilion, the 13-storey luxury condominium coming soon to the corner of Sackville and South Park Streets, where the old CBC Radio building currently sits empty. Next door, and across a manicured piazza, will be Curve, the Pavilion’s slightly lower-end sister building of 200 apartments spread over 15 floors. Together they form the multi-million dollar venture of Jim Spatz, owner of Southwest Properties, and his partners. Pavilion is 85 luxury condo units above prime retail space, including a massive, state-of-the-art YMCA facility. But the biggest selling point is the unspoiled view of green-space that is almost guaranteed never to be developed. (Unless Halifax gets really desperate and sells off the Public Gardens and Citadel. Knock on wood.)

By themselves the location and amenities are impressively luxe for Halifax. But given the sales, there is clearly a demand. After the opening weekend, 80 percent of the units had commitments (in the form of two percent down). It took just five weeks for the sell-through rate to bump up to 90 percent. Two penthouse units had to be made available and one was snapped up almost immediately. One man bought two $4.5-million units next door to each so he can knock down a wall and create one massive suite spanning an entire side of the building. Another woman released her hold on a unit after getting cold feet, only to change her mind and buy it back two weeks later. By then, the cost had shot up $40,000. She paid the price of waiting, literally and figuratively.

Welcome to Halifax’s new condo market.

A model suite in the Pavilion, which will replace the CBC Radio building at South Park and Sackville (and is already 90 percent sold).

Geoffrey Creighton

Before 2011, single-unit dwellings (i.e. houses) were not only the bulk of new construction starts in the HRM but also the dominant dwelling type in the urban landscape. Condos were small potatoes. But for the past four years, multi-units have become the majority of construction, with signs showing condos builds increasing into 2016. A quick tally says there’ll be around 2,000 units, primarily condominiums, built in the downtown core over the next three years, changing Halifax’s urban landscape into one more resembling the skylines of Toronto and Vancouver. The question remains, though: with Nova Scotia’s much-publicized shrinking population and somewhat stagnant economy, who the frig is going to buy all these units?

Halifax’s modest increase in population over the past half-decade might seem like the obvious answer. New residents means more people to buy up property. But it’s not that simple. With an increase of active listings and weaker sales volumes, the Halifax housing market is growing, but at an incremental pace. More troubling for the Halifax apartment market specifically is the forecasted rental apartment vacancy rate. It’s expected to rise to five percent by 2016, up from its current rating of 3.8 percent. Those are both above the Canadian average. No, the condo boom isn’t born from necessity. It’s being designed.

The spike in developments these last few years stems, in part, from the city’s 2009 changes in development bylaws and regulations. With varying degrees of success, Halifax has been trying to improve downtown living since the ’40s. It was the 2009 HRM by Design plan which finally spelled out a strategy for downtown rejuvenation while overhauling outdated regulations. The 365-page document loosened bylaws to allow for taller buildings, and expedited the planning application approval process. One of the main motivations behind the changes is to increase downtown residential density. The city wants more people living downtown. By 2034, HRM hopes to have 25 percent of total development happening in the downtown core (which includes downtown Dartmouth).

“Downtown is a major focus area for the city. The more activity the better. It’s good for the whole city in the broader sense of the term,” says Kurt Pyle, Halifax’s operations manager for development approvals.

“If downtown Halifax is thriving, that influences the whole municipality.”
More economic stimulation from commercial and residential developments means more money flowing in the city. For another, tapping into existing infrastructure and resources, like schools and sewers, cost a lot less than building it out to suburban or rural developments. It seems like a no-brainer. Developers like Louis Reznick are betting as much.

“For whatever reason, Halifax was off the radar for many people, but it’s a changing market,” the developer of The Roy on Barrington Street says. “I believe that there hasn’t been the choice to live in the downtown area. How can people buy [downtown condos] if they don’t exist? For us it was the perfect storm of events. The product was in demand already but it wasn’t available. That’s where it starts. Once you have people living downtown, things start happening—merchants are waiting to do more. One just begets the next.”

Despite a sluggish housing market, Reznick’s right. People are buying these units. Pavilion’s sales hover around 90 percent. The Dillon at Sackville and Market Streets (the former home of Night Magic Fashions) has barely begun and is already 40 percent sold. Harris East in the north end is at 70 percent sold and still under construction. Though Reznick was hesitant to give an exact figure, he says The Roy has had “very good sales, on track with expectations,” which he expects to pick up as the building nears completion in the spring of 2017.

For more on residential developments coming online in Halifax’s near future, see our interactive map below.

But denser cities don’t make as much of an impact as denser buildings. Or so says Jill Grant, professor at Dalhousie’s school of planning. Grant is in favour of increasing densification on the peninsula—to a point.

“There is the hope that condo buildings will be a positive feature for Halifax. That’s the theory, at least. The big challenge is getting higher building unit densities.”

For the downtown’s improvement to be sustainable, Grant says buildings need higher occupancy. Three- and four-bedroom units need to be available for young families. We need denser buildings, not just neighbourhoods. Single occupancy units—which many new apartment and condo buildings cater towards—won’t improve cities. Families improve cities.

“That’s when infrastructure and amenities, like schools and transit, are improved.”

click to enlarge

Grant also warns of polarization that can occur when new luxury condos are built in underdeveloped areas (like downtown), or next to pockets of lower-income earners (like the north end). She was part of a team who tracked individual incomes in the HRM over the past 40 years of census data to map how neighbourhoods have changed. The peninsula was once a fairly congruous area. Average earners acted as a buffer zone between pockets of above-average earners living along the water’s edge in the south and a concentration of lower earners in the north end. Fast-forward 40 years, and the latest data shows the peninsula has grown more affluent, without any major concentration of similar incomes. It’s a “mosaic” of high-income areas abutting areas of the very lowest earners. That’s also known as gentrification, which tends to displace low-income groups by wealthier inhabitants. Though the polarization of wealth is concerning, Grant says it’s still to a lesser degree than Toronto or Vancouver—two cities struggling to rejuvenate inner-city areas bordering affluent neighbourhoods.

If Halifax is going to avoid the inner-city slums and barren condo wastelands of larger cities there has to be a concerted and conscious effort by the city and developers to cultivate inclusive communities suitable for families of all incomes. Which is difficult. Pyle explains that Halifax has no jurisdiction on what goes on inside the building. Developers can make their units as expensive and as polarizing as they like. There’s no governmental oversight on how a development displaces neighbours, and there is limited requirements for family-friendly housing (an additional-floor “bonus” exists if family housing is included in designs). In order to encourage infrastructure, like schools and transportation, Jill Grant says young and lower-income families have to be a key part of development strategies.

Unfortunately, families are shrinking. The fertility rate is dropping below government forecasts. It’s already among the third-lowest in the country, and is expected to decline even further. By 2026, the Nova Scotian government has projected that the primary and secondary school age population will drop by more than 30 percent. People are having fewer children. So it’s perhaps unsurprising that developers aren’t targeting families. Just take a look at the housing market trends: last year a five-bedroom, three-bath home on Young Avenue spent 246 days on the market before selling for $450,000 less than its original asking price. That isn’t uncommon. Larger houses, with large lots to go with them, are struggling to sell. Smaller north-end row houses and condos are the ones selling fastest.

Another important trend is the aging population. A majority of Nova Scotians are entering retirement in the next decade. Empty nesters and mobility reduced seniors don’t need massive houses away from all the downtown action. In addition, lifestyle trends in the city have changed over the past decades. More people are living alone in Halifax. The number of single-dwellers in Halifax has steadily risen over the past 50 years. In 2011, of the total occupied dwellings in the HRM, 29 percent were single dwelling (second to two-person households).

All of this taken into consideration, it becomes apparent why realtors and developers are confident condos will thrive in Halifax. They make sense for the childless, the elderly and the financially stable young adult. The condo boom Halifax is on the precipice of will bring some much-needed economic stimulation to the downtown core, but it doesn’t come without a price. People will be displaced. Neighbourhoods will change. Rents will increase. Like it or not, gentrification will sweep far and wide as Halifax’s underdeveloped seaside identity gives way to a fresh urban face.

Ruminate on those thoughts will sipping espresso in your glamourous condo. That downtown skyline you’re gazing out at keeps changing—expanding. Halifax is growing up. Let’s see what it turns into.

Jessica Flower is a freelance journalist
in Halifax by way of Toronto.

2183 & 2215 Gottingen Street
240 units over two, six- and nine-storey buildings
Housing Trust of Nova Scotia
Notes: Former home of Diamond Bar and the MET. One half of the units will be affordable housing.
Status: Approved

Richmond & Symonds Street
160 units over two buildings of four and six storeys
Genivar WSP
Status: Approved

St. David’s Church Hall
1537 Brunswick Street
67 units over seven storeys
Greenwood Lawley
Notes: Replacing the St. David’s church hall, the development will help offset the church’s financial struggles.
Status: Proposed

The National Film Board Building
1572 Barrington Street
16 units over five storeys
The Annapolis Group
Notes: The NFB’s burned-out facade will remain as a new building is erected behind it.
Status: Under construction

The Avery
25 Alderney Drive, Dartmouth
48 units over five storeys
The Annapolis Group
Status: Under construction
Starting from $342,900

The Boss Plaza
3620 Dutch Village Road
130 units over two seven-storey buildings
United Gulf Developments Ltd.
Notes: Former site of Halifax West High School.
Status: Under construction

The Mary Ann
Queen & Clyde Streets
135 units over nine storeys
WM Fares Group/Banc Properties
Notes: Along with Margaretta and Rosina, named after three sisters who gave Schmidtville its name.
Status: Under construction

Margaretta
Clyde Street & Dresden Row
163 units over nine storeys
WM Fares Group/Banc Developments
Notes: Along with Mary Ann and Rosina, named after three sisters who gave Schmidtville its name.
Status: Proposed

Rosina
Queen Street & Morris
WM Fares Group/Banc Developments
Notes: Along with Mary Ann and Margaretta, named after three sisters who gave Schmidtville its name.
Status: Planned

*Images from city documents or development websites. Some prices listed may be pre-sale only. Compiled with information from Halifax's planning office, and other civic sources. Researched by Jacob Boon, Jess Flower, Michael Lee, Kimber Lubberts, Jenn Murphy and Gabby Peyton. This is a continuing project. See something we missed? Let us know below or contact news@thecoast.ca